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You understand that managing your inventory by excel spreadsheets is no longer a solution. You understand that the costs of data entry errors are too much to overcome. As such, you’ve moved forward with investing in an enterprise resource planning (ERP) software and have started to barcode all inventory counts. You also understand that to properly manage your warehouse means you must continually keep track of your work-in-process, raw material and finished goods inventory. Doing away with spreadsheets was the first step, while the second included purchasing an inventory management software. The third and final step includes upgrading your warehouse with automated storage and retrieval systems. So what kind of benefits can you expect from this third and final step? More importantly, why have so many of today’s enterprises decided to install these automated storage systems?

Reducing Costs of Obsolescence, Damage and Theft

There are three costs of inventory that can be reduced by using automated storage systems: Inventory obsolescence, inventory damage and finally, inventory theft. All three have a direct impact on profit, and most importantly, a direct impact on a company’s bottom line. The reality is that manual processes don’t allow companies to capture, track or eliminate these costs at the source. They don’t allow enterprises to track their incidence in real-time. In fact, most only find out damage, obsolescence and theft is a problem long after it has occurred.

Barcoding inventory is but one solution to this aforementioned problem. However, barcoding alone won’t reduce the incidence of damage, obsolescence and theft. Barcoding alone won’t improve the accuracy and precision and upgrade your materials management processes. What’s required is an automated storage and retrieval system that tracks, stores and protects inventory at all times. Again, speed and accuracy are essential. However, it’s wrong to assume that all storage and retrieval systems are automated and computer-controlled. Here are two options with respect to the types of storage systems your company can use.

• Manually Controlled Storage Systems: Raw material allocation and order picking is simplified with manually controlled storage systems. These systems and storage units are functional, easy-to-manage and just as easy-to-control. While they are not fully computer-controlled or integrated, they still allow warehouse personnel to manage storage spaces, carousels and bins with ease.

• Automated and Integrated Storage Systems: Fully automated and integrated storage systems are the ultimate in warehouse management and efficiency. They allow for complete integration of the company’s ERP software with the warehouse retrieval storage system. Order picking is optimized and controlled via ERP-generated work orders. The entire system allows operators to easily pull inventory via direct and remote terminals.

Automated storage and retrieval systems will not only improve how you manage your warehouse, but they will also upgrade your entire supply chain. You’ll no longer have to concern yourself with damage and obsolescence. You’ll have better control of incoming and outgoing shipments. You’ll protect your inventory from theft by being able to segregate your inventory within vertical and horizontal storage carousels, thereby keeping your most valued inventory out of reach.

This has been a guest post by the Schaefer Shelving, helping customers improve their supply chain, logistics, storage and distribution processes.